Brazil. 2016 was a particularly difficult year for Brazil. Political and economic issues ended up affecting all productive sectors and the audiovisual industry was no exception. Despite this panorama, a company stands out for having turned those difficulties into opportunities.
AVI LATINOAMÉRICA spoke with João Yazbek Jr, CEO of Advanced Audio Technologies, AAT, a company that had a growth of 75% between August 2015 and the same month of 2016.
How did AAT grow to double digits in a difficult year like 2016?
João Yazbek Jr: From August 2015 to August 2016, the growth of the AAT was 75% and this occurred in a period of severe economic crisis in Brazil. Considered in isolation, this figure may seem too high, because most Brazilian companies are suffering from tight margins. But AAT's growth has its roots planted in strategic decisions made years ago, which are now producing results and enabling incredible growth in an intense time of crisis. This is a scenario that the vast majority of managers of Brazilian companies had no idea was going to happen in 2016.
The most important factor to consider in our history is the positioning of the company, which operates in the audio and home teather market in the "middle segment", which suffers less from the crisis for attending classes B, A and AA. This category has benefited from the high prices of high-quality products, the high reflection of the US currency in the Brazilian market and the reduction in demand.
How do AAT's products stand out to achieve this growth?
João Yazbek Jr: This position was achieved by having products with an innovative design, overall quality and competitive prices. Therefore, the perceived profit by customers is quite high and they are redefining Brazil's audio market, with the introduction of a new paradigm: Exceptional Quality Brazilian products at a fair price.
Another important fact is that the AAT, through heavy investment, launched 20 products at the end of 2015. And then, immediately before InfoComm Show 2016, more than a dozen products. This speed in the introduction of new products was only possible because AAT invested heavily in the development of products with its own engineering and highly qualified, with manufacturing integrated in the same plant.
With this, you get a lot of speed and quality in product development, which is precisely the "core business" of AAT. We can be the only Brazilian company with complete product development capacity in the current audio market.
What are the strongest segments of the audiovisual industry for AAT?
João Yazbek Jr: In Brazil, the video market is the strongest segment of the industry in terms of revenue. Then we have the professional/enterprise audio markets. Even though the home audio market isn't ahead, we think it was neglected by large companies.
And if video is strong in the market, a considerable number of consumers of this type of product are always dissatisfied with mass consumption audio solutions and begin to get better quality audio products, in the creation of their home theater or simply to improve the sound of television, that has gotten worse every year.
Is your market only in Brazil?
João Yazbek Jr: We are currently working increasing the capacity of our local distribution. Brazil is a country of continental dimensions, and we still have a lot to grow internally. But we are starting our work in search of expansion in other markets.
Home teather is a sector that is affected by the economic crisis, is it still growing in Brazil?
João Yazbek Jr: The audio and video industry always has a certain retraction of demand in times of crisis. We operate in an industry where sales depend on the existence of financial surpluses and people's willingness to spend, which is affected by consumer confidence. Both are low in our country at the moment, which causes the total demand of the sector to retract.
However, the AAT has benefited greatly from the rise of the dollar in 2015. This scenario helped both those who manufacture and buy locally. That is, the market as a whole declined during 2015 and 2016, but increased our share due to our growth and the fact that imported products have become too expensive for the consumer. And we enter this market with world-class products at competitive prices.
What are the new products introduced by the company in 2016?
João Yazbek Jr: Earlier this year, a new line of high-performance amplifiers for the residential market is introduced, redefining what can be done in Brazil. Amplifiers are superior to the best brands on the market at a fraction of their cost.
We have also launched a line of subwoofer amplifiers and a recessed box for corporate use. And now, in September, during an event held for our distributors, we showed two new products that tend to create two new product families: a multi-room amplifier and an energy conditioner. Today, our product lines include about 80 different elements, something that was only possible thanks to the flexibility provided by our own development and local production.
